Leveraging artificial intelligence (AI) for “front office” solutions, including conversational banking, can save the financial services industry $199 billion, according to an analysis from Business Insider. No matter how you extrapolate that data, it equates to savings for financial institutions as well.
So, financial institutions are boarding the AI bandwagon. Most FIs are highly aware of the potential benefits presented by AI and machine learning, but implementations have been skewed by size: 75% of respondents at banks with over $100 billion in assets say they're currently implementing AI strategies, compared with only 46% at smaller institutions.
This begs the question: How can smaller institutions ramp up their AI game to capitalize on the cost-savings and efficiency that it brings?
For starters, they can take a closer look at companies like Posh Technologies, a Boston-based company specializing in offering conversational AI to banks and credit unions via both digital and voice-based channels. The company’s AI automation platform works with natural language, providing a more personalized customer/member experience. What’s more, Posh has designed its functionality to specifically address the needs of community banks and credit unions.
“We are very focused on this part of the market,” said Karan Kashyap, Posh’s co-founder and CEO. “Other conversational AI platforms are very horizontally built—not only working with banks and credit unions, but healthcare, utilities, and more—so they don’t do anything that requires depth. With Posh, we’re verticalized in one industry and are focused on doing that really well.”
Kashyap indicated the company will be making an announcement in the coming weeks that sets them up to triple their size and expand capabilities and services. And as AI takes deeper root in financial services, the timing couldn’t be better for community banks and credit unions.
I sat down with Kashyap to learn more about what Posh can offer financial institutions as a FinTech partner. An excerpt from our conversation follows.
NEACH: Can you share a little more about Posh’s functionality?
Kashyap: Posh is a conversational AI company working with banks and credit unions across digital and voice-based channels, including websites, online banking, mobile banking and mobile apps, and voice through the telephony channel. Our goal is automation, not only FAQ/transactional automation, but also incorporating end-user data to answer questions and personalize the experience.
NEACH: You also offer intelligent insights from these interactions, sharing data back with the FI. Can you expand a little on that?
Kashyap: Absolutely. We provide insights and analytics to help the FI enhance its operations. For example, we provide a tool where FIs can go into historical logs, filter by topics, and extract those most relevant to solving an operational problem.
We also took that a level further by exploring the conversations in which AI is not fully solving the problem—so we need to hand off the AI conversation to a human. To compile information, we created a tool that visualizes the conversational topics with the most escalation. Then the FI’s team and Posh’s team collaborate to make it work better, whether that be strengthening the AI or educating the end user a bit more.
NEACH: Automation certainly seems important, but for community banks and credit unions, the customer/member relationship is critical to success. Some may worry that by employing AI, their customers/members may feel disconnected from their institution. How does Posh address that?
Kashyap: That’s a great question. We really started to grow Posh at the onset of the pandemic. We had done a few different deployments prior, but as COVID started, we were ready to hit the gas pedal. What we found is that pain points shifted. Suddenly, we were hearing from FIs, “I’m getting overwhelmed in my call center. I can’t offer 24/7 customer or member services.” In addition, customer and member service is a high-churn job, so staffing has started to become an issue. Posh helped our customers address those concerns and more.
For example, we had a customer in New Hampshire reduce the number of live agent needs by 70% in two months. These were what we call tier one and tier two questions—ones that were not super complex—but AI can handle simple inquiries that don’t require a human staff person or can help the member or customer self-serve. We see it as the first line of defense to get people out of the queue. That way, complex questions that need an agent get to resolution faster.
NEACH: With any third-party relationship, FIs want to know how implementation will work. For example, do you work with core providers?
Kashyap: We have direct relationships with financial institutions, and we have integrated our technology into systems like Jack Henry, COCC, Fiserv, FIS, and other major cores.
In terms of implementation, it depends on what approach the FI wants to take. Some of our products are integrated into the customer relationship management system (CRMS), cores, and payments systems. Others are more front of the pin, offering something like an interactive FAQ to help customers/members self-serve.
The former, when AI is deeply integrated into systems, takes between 10 and 12 weeks to deploy. Without deep integrations into the banking system, it’s four to six weeks. Posh's team of content and AI experts is always there to help FIs through this journey.
NEACH: We’ve covered a lot of ground today. Any additional thoughts for FIs to consider?
Kashyap: AI doesn’t have to be a thing that replaces people or systems; we’re augmenting people and adding a layer of intelligence over top of it. AI has the capacity to help FIs improve customer and member service quickly, but AI is a long-term play. Our customers who have seen the best ROI have approached AI as an innovation project and worked to make it successful. When you hire for a call center, you have to train employees on policies and procedures. AI is the same. It takes commitment to spend time coaching and evolving it.
Kashyap will be speaking at NEACH’s Future of Payments Symposium, taking place virtually December 8-9, where he will be discussing how AI can help banks and credit unions level the playing field and compete with megabanks and other providers. In addition, he’ll share specific case studies and offer insights into how FIs can phase in AI in a step-by-step manner. For more information or to register to attend, visit https://fps.neach.org/.
AUTHOR: Joe Casali, AAP, NCP
Executive Vice President
As the EVP of Payments Innovation for NEACH, Joe focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Joe to read more of his blogs, articles, and posts.